Business insurance explained: Key policies every company should consider

November 5, 2025

If you’re a business owner, you will be aware of the many threats and perils to your enterprise – its premises, liabilities, or the incapacity of its directors or chief officers. Thankfully, business insurance helps safeguard your firm against such risks.

To understand how such protection works, let’s take a brief look at the types of business insurance available and the principal elements of cover typically included.

Types of business insurance

Your choice is between two main types of cover:

Business package insurance

• business package insurance is just as it says – a ready-made package containing all the aspects of cover likely to be required by the typical business, such as shops, offices, or trade firms;

• since the elements of cover are bundled together in a standard package (which may vary in its details, of course, from one insurer to another), the overall cost of this type of cover may be somewhat more cost-effective than buying the individual elements separately;

Combined commercial insurance

• alternatively, you might want to select for yourself the various elements of cover you need for a bespoke combination of protections – whether these make the most of property insurance, liabilities indemnity, or directors and officers cover;

• combined commercial insurance such as this may give your business more individually tailored and flexible protection.

What business insurance typically covers

Whether you opt for business package insurance or combined commercial insurance, there are typically common risks facing your business – both types of insurance can effectively safeguard against some or all of the following:

Premises

• your business premises are central to your enterprise, of course, and the risk of loss or damage can come from a wide range of threats such as fire, flooding, storm damage, impacts, thefts, vandalism, and break-ins;

Unoccupied property insurance

• from time to time, it might be necessary for you to vacate your business premises (for renovation or decoration or because of a downturn in trade, for example);

• unoccupied property insurance may be necessary to maintain the overall protection for the structure and fabric of the business buildings;

Public liability

• public liability is one of the major liabilities your business may face;

• if a customer, supplier, or member of the public sustains an injury or has their property damaged when at your premises or in any other connection with your business, you may be held liable and ordered to pay substantial compensation – public liability insurance offers indemnity against such claims;

Employers’ liability

• this is cover over which you have no choice if you employ anyone (with very few exceptions) in the running of your business;

• the law is clear – if you are an employer, you must have at least £5 million of employers’ liability insurance;

Product liability

• you may be held liable and ordered to pay hefty compensation, to anyone who sustains an injury or suffers other losses because of a defective product that your business supplies, manufactures, or designs;

• product liability insurance provides indemnity against such claims (up to set limits);

Directors and officers insurance

• the backbone of many a business is its directors and officers;

• although they play a significant role in the success of the business, they are not infallible. Your directors or officers can make mistakes, exercise poor judgment, or otherwise commit what the law may regard as “wrongful acts”;

• directors and officers insurance – often simply known as D&O insurance – can indemnify you against claims arising from allegations of such mistakes and errors committed by the leaders of your business;

Cyber insurance

• like many a business owner, you might be alarmed by the extent to which your enterprise relies on information technology – the risk of loss or abuse of that data could strike at the very heart of your business;

• cyber insurance helps to protect you against the financial losses incurred through loss or damage to information from any of your systems for information technology (IT) and the networks you use;

Fleet insurance

• for any business that relies on even a relatively small number of vehicles in the course of its operations, fleet insurance offers a cost-effective and efficient means of ensuring that every vehicle in your fleet remains adequately covered by essential motor insurance.

Whether you opt for the ready-made business package insurance or pick the necessary elements for your bespoke combined commercial insurance, the appropriate business insurance might prove the saviour of your business in the face of any number of risks and perils.

At Alan Blunden, we are always happy to help guide you through the different options available, so you can enjoy the peace of mind of knowing that you have the most appropriate business insurance for your enterprise. Please call us Monday – Friday: 9.00am – 5.00pm on 01702 826060.